MNI Australia Money Supply Growth Lowest In 26 Years

--Investor Mortgage Growth Y/Y At Record Low

By Sophia Rodrigues

     SYDNEY (MNI)  - Private sector credit rose less than expected in May,

according to data published by the Reserve Bank of Australia Friday, that also

showed money supply growth at a 26-year low.

     The trend of slowing in money supply growth in Australia, widely considered

as a gauge of future economic activity, follows similar experience in several

other countries.

     The pace of slowing in Australia, however, appears faster than the others

with M3 growing just 2.5% y/y in May and broad money also at 2.5% y/y. Both

compared with 7.5% growth in the same month last year, and lowest since 2.7% in

M3 and 2.0% for broad money in October 1992.

     Meanwhile, private sector credit rose just 0.2% m/m, matching an increase

last seen in January 2017. On a y/y basis, private sector credit growth slowed

to 4.8% from 5.1% in April.

     Housing credit rose 0.4% m/m in May, the same as April but in y/y terms

slowed further to 5.8% in May from 6.0%.

     Investor mortgage credit was flat m/m for the first time since December

2015 but y/y growth slowed to a record low.

     Business credit fell 0.2% m/m in May and personal credit also dropped for

the fourth month in a row. In y/y terms, personal credit fell 1.3%, a rate last

seen six years ago.

--MNI Sydney Bureau; tel: +61 2-9716-5467; email: sophia.rodrigues@marketnews.com

[TOPICS: M$A$$$,M$L$$$,MT$$$$]